New Delhi, Business Desk. There are often calls from the bank for the credit card. If you are working in a good company, then you are also told about higher credit limit. Banks discuss various types of offers for giving credit cards. Although there are some things that banks or credit card companies hide from you, you should consider these things before taking a credit card. Know which are the things that you should keep in mind while taking a credit card.
Loan : It is often heard from the elderly that one should avoid taking loans. The advantage of credit card is that you can shop anytime, anywhere, but for this you have to deposit the loan amount. However, even if you do not pay the entire amount for it at once, you can pay it in installments as well.
Higher penalty : If you make a minimum payment every month by shopping with a credit card, you have to pay interest instead. If there is a default in payment then a higher penalty along with interest is to be paid. Apart from this, a fee has to be paid for using a credit card.
Cash withdrawal is expensive : If you withdraw cash from credit card at any time, then it will also cost you dearly. More interest has to be paid for this. There is also a penalty along with interest for default in its payment.
High Interest Rate : The bank does not ask to carry forward the balance till the next month! The bank charges interest on your balance, it is very high. Many times a discount offer is offered for purchases made by credit, but the rebate that you get at the time of filling the money spent on the card ends up as interest.
Credit Activity : The bank offering the credit card keeps reviewing the card. Typically, these reviews occur every six to 12 months. If you have made any negative change regarding credit card or have made any mistake in payment, then the credit card issuer keeps on knowing this. If he finds something wrong, he can raise the interest rate.
